The New Narrative of the $5000 Era: "The Old King" Returns, How to Understand the Tokenization Logic of Gold?

Article by: imToken

If a year ago, someone told you that gold would rapidly rise to $5000 per ounce, most people’s first reaction would probably be that it’s wishful thinking.

But the fact is, it happened. In just half a month, the gold market, like a runaway horse, repeatedly broke through historical levels at $4700, $4800, $4900 per ounce, and with almost no turning back, moved toward the $5000 mark that the market has been watching collectively.

Source: companiesmarketcap.com

It can be said that after repeated validation of global macro uncertainties, gold has returned to its most familiar position— as a consensus asset that does not rely on any single sovereign promise.

But at the same time, a more realistic question is emerging: When the consensus on gold returns, are traditional holding methods already unable to meet the needs of the digital age?

1. The inevitable macro cycle: “The Old King” returns to the throne

From a longer macro cycle perspective, this major upward cycle in gold is not short-term speculation but a structural return under the backdrop of macro uncertainties and a weakening dollar:

Geopolitical risks extend from Russia-Ukraine to key resource and shipping routes in the Middle East and Latin America; the global trade system is repeatedly disrupted by tariffs, sanctions, and policy battles; the US fiscal deficit continues to expand, and the long-term stability of dollar credit is increasingly debated. In such an environment, the market will undoubtedly accelerate in search of a value anchor that does not depend on any single country’s credit and does not require external endorsement.

From this perspective, gold does not need to prove it can generate returns; it only needs to repeatedly prove one thing: in times of credit uncertainty, it still exists.

This also to some extent explains why, in this cycle, BTC, once expected as “digital gold,” has not fully taken on the same consensus role—at least in the macro safe-haven dimension, the market’s choice has already spoken (see extended reading: “From distrustful BTC to tokenized gold, who is the real ‘digital gold’?”).

However, the return of gold consensus does not mean all problems are solved. After all, for a long time, investors could only choose between two imperfect holding methods.

The first is physical gold, which is sufficiently safe and sovereign-complete, but almost lacks liquidity. Like gold bars locked in safes, this entails high storage, theft prevention, and transfer costs, and also means it can hardly participate in real-time trading or daily use.

Recent phenomena such as “difficult to find a safe deposit box” in many banks precisely illustrate this contradiction being amplified, indicating that more and more people want to hold gold in their own hands, but the reality often does not cooperate.

The second is paper gold or gold ETFs, which to some extent compensate for the physical holding barriers of physical gold, such as paper gold products issued by banks or brokerages, which are essentially claims on financial institutions, providing a settlement promise backed by an account system.

But the problem is, this liquidity itself is not comprehensive—the liquidity provided by paper gold and gold ETFs is confined within a single financial system. They can be bought and sold under specific banks, exchanges, or clearing rules, but cannot freely circulate outside that system.

This means they cannot be split, combined, or integrated with other assets across systems, let alone be directly used in different scenarios. They are merely “in-account liquidity,” not true asset liquidity.

The first gold investment product I owned, “Tencent Micro Gold,” was like this. From this perspective, paper gold has not truly solved the liquidity problem of gold; it only temporarily replaces the inconvenience of physical form with counterparty credit.

Ultimately, safety, liquidity, and sovereignty are long-term trade-offs that are difficult to reconcile. In an era of high digitalization and cross-border integration, such compromises are becoming increasingly unsatisfactory.

It is in this context that tokenized gold has begun to enter more people’s view.

2. Tokenized gold: Returning “full liquidity” to the asset itself

Represented by Tether’s XAUt (Tether Gold), tokenized gold aims to solve not just the superficial issue of “making gold easier to hold/trade,” which paper gold can also do, but a more fundamental question:

How to ensure that gold, without sacrificing its “physical backing,” can achieve the same, cross-system transferable, fully liquid, and composable properties as crypto assets?

Taking XAUt as an example, its design logic is not radical but rather quite traditional and restrained: each 1 XAUt corresponds to 1 ounce of physical gold stored in London vaults, which is auditable and verifiable, and token holders have claims on the underlying gold.

This design does not involve complex financial engineering nor attempts to amplify gold’s properties through algorithms or credit expansion. Instead, it deliberately respects the traditional logic of gold—first ensuring the physical backing, then discussing digital transformation.

Ultimately, tokenized gold like XAUt and PAXG is not about “creating a new gold narrative” but about re-encapsulating the oldest asset form via blockchain. In this sense, XAUt is more like a “digital physical gold” rather than a speculative derivative in the crypto world.

Meanwhile, a more significant change is that the liquidity hierarchy of gold has undergone a fundamental shift. As mentioned earlier, in traditional systems, whether paper gold or ETFs, liquidity is essentially in-account liquidity—it exists within a single bank, broker, or clearing system, and can only be bought and sold within predefined boundaries.

XAUt’s liquidity, however, is directly attached to the asset itself. Once gold is mapped to a blockchain token, it naturally possesses the fundamental properties of a crypto asset: it can be freely transferred, split, combined, and circulated across different protocols and applications without needing permission from any centralized authority.

This means gold no longer relies on “accounts” to prove its liquidity but exists as an asset in its own right, capable of free global circulation 24/7. In the on-chain environment, XAUt is no longer just a “tradeable gold token” but a basic asset unit that can be recognized, invoked, and combined by other protocols:

• It can be exchanged freely with stablecoins and other assets;
• It can be incorporated into more complex asset allocation and portfolio strategies;
• It can even serve as a value carrier for payments and consumption scenarios;

This is precisely the part of liquidity that paper gold has never been able to provide.

3. From “on-chain” to “usable”: the true watershed for digital physical gold

Therefore, if tokenized gold only completes the “on-chain” step, it is far from reaching the endpoint.

The real watershed lies in whether this “digital physical gold” can truly be easily held, managed, traded by users, and even used as a “currency” for consumption and payments. Returning to the earlier point, if tokenized gold merely remains a string of code on the chain, ultimately encapsulated within centralized platforms or single entry points, then it is no different from paper gold.

Against this backdrop, lightweight self-custody solutions like imToken Web are beginning to show their significance. Taking imToken Web as an example, it allows users to access via browser—like opening a webpage—instantly managing their tokenized gold and other crypto assets on any device.

In a self-custody environment, users hold their private keys entirely; your gold does not reside on any service provider’s server but is anchored in a blockchain address.

Moreover, thanks to the interoperability of Web3 infrastructure, XAUt is no longer a dormant metal in a safe. It can be used flexibly for small purchases, and when needed, through tools like imToken Card, the purchasing power of gold can be instantly released into global consumption scenarios.

Source: imToken Web

In short, in a Web3 environment, XAUt can not only be traded but also combined, exchanged with other assets, and connected to payment and consumption scenarios.

When gold first possesses both high store-of-value certainty and modern usability potential, it truly completes the leap from “old-fashioned safe-haven” to “future currency.”

After all, gold as a consensus that can span thousands of years is not inherently outdated; what is outdated is only the way it is held.

So when gold, in the form of XAUt, enters the blockchain and is re-controlled by individuals through environments like imToken Web, what it continues is not a new narrative but a timeless logic:

In an uncertain world, true value is about relying as little as possible on others’ promises.